Change for calls
Telephone calls are the third-largest source of revenue for hotels, after beds and food and beverage. If hotels can record calls efficiently and competitively, and encourage guests to use the telephone more, they stand to make even greater gains.
Computer call logging systems are a way of gaining these advantages. These systems take information about outgoing calls from the switchboard, calculate their cost, post them to guests' bills and record the information for the hotel as well - all of which used to be done manually by the front office staff. Call management systems are capable of offering further features.
Some call logging systems are software extensions of a property management system (PMS), such as those offered by Innsite, LK Global, Welcome and Micros Fidelio. Others, like Infodata's Telecall 3000, can stand alone. Avon Data Systems is bringing out a new version of its call logger next year, which will also be able to stand alone.
Whatever the system, they rely on the switchboard to provide the information to be processed. This means the switchboard may limit the services the call logger is able to provide. Recently this has become a crucial problem as BT (the main carrier of telephone services in this country)is due to change the method it uses of charging for calls, making some switchboards unable to log outgoing calls.
Peter Smith, network marketing manager for BT, explains: "Until now BT has charged by the unit. Each unit is charged at a fixed rate, currently 4.2p, and the longer or further the call, or the more expensive the time of day, the faster the units are used up.
"During the call the ex-change sends a pulse down the line to the customer's equipment each time a unit is used. This is the meter pulse. Lots of hotels still use this to operate their call logging systems."
Hotel switchboards count the pulses, then a member of staff or the call logger multiplies this number by the hotel's unit rate to guests - this would include a typical mark-up of 300% - and the charge is then posted to the guest's bill.
Call charge changes
But the EU has now decided to make billing per second (rather than per unit) compulsory, which means BT has to change its method of charging, making meter pulsing redundant. Owners of switchboards which rely on meter pulsing are left with a twofold problem: many rely on meter pulses not only to show a call's cost, but also to indicated whether there has been a connection at all. No pulses are sent if a call is not answered.
But with per-second billing the process is completely different. A called-party answer signal is sent down the line when the call is answered. Unfortunately many switchboards are unable to detect this signal, and those that can are not able to pass the information to the call logger.
In response to lobbying by users, BT has decided to keep meter pulsing at least until the year 2001. Although counting pulses will not show to the second how long calls last, it is the best immediate solution for hotels that depend on this technology. BT expects to make an announcement in early November about what will replace meter pulses.
But there is a further complication: the Government has allowed carriers on to the market that do not use meter pulsing. Although a protocol exists for called-party answer signals, so far carriers are not obliged to conform to it. So hoteliers may be unable to change carriers from BT because their equipment is incompatible.
The obvious answer is to buy a new-generation switchboard that can interpret these signals. But this is a major expense, especially for a small establishment which may still be years away from covering the cost of the old one - the pay-back period can be as long as 12 years. What action can be taken in the meantime?
"One way is to buy a device to generate meter pulses," says Mark Read, communications manager for the Tower Hotel, London, and chairman of the Hotel Telephone Managers' Association. "A few companies are producing a device which sits between the switchboard and the carrier, translating details about the calls into a format which the switchboard can recognise."
Erskine, which distributes office equipment, is marketing just such a device, ACCess Hotel, on behalf of the long-distance carrier ACC. Sales manager Simon Watson conducted an informal fax survey of 2,000 hotels, which produced a huge response.
Low-cost calls
"They were asked if they would like low-cost telephone calls and the opportunity to get away from meter pulsing," says Watson. "The target market is those people who are dependent on the meter pulse service, which means they are tied to BT." ACCess Hotel logs how long a call has lasted, and routes all calls via ACC.
There are other devices, such as one made by Mitel, that are not tied to one carrier, and can select the cheapest method for each call. But they are expensive, and the call logger or call manager has to match data from two inputs, the device and the switchboard.
Hotels have to balance the advantage of having a choice of carrier with the fact that some, such as ACC, are prepared to bear the cost in return for the hotel's exclusive business. Companies offering call management services, such as TMS and SR Comms, can also choose between carriers.
Another solution is where call loggers use calculations called algorithms to work out the length of a call. These make a guess as to when the call has been answered, usually 15 seconds after the guest has dialled out. But the dangers are obvious. Some guests will be asked to pay for calls they did not make, which will provoke complaints. On other calls the hotel loses up to 15 seconds' revenue.
There are other complications. "For an algorithmic method to be accurate it also needs to be updated with the latest tariffs all the time," says Bt's Smith. "This is not so for meter pulses, because BT alters the rate of use of the unit."
Computing a solution
The processing abilities of computers can use call logging and call management to turn this difficult situation around.
Counting meter pulses does not allow the hotel to apply discriminatory pricing, that is, to charge different rates for different destinations - there is a standard mark-up on each unit.
If it is possible to distinguish destinations, it is also possible to use the information to keep hotel telephone services competitive with payphones, mobiles and calling cards.
"The call logger or call manager picks up the number dialled and compares it with the tariff the hotel has set for that destination," says Justin Percival, sales consultant for Infodata. "If the hotel has the right equipment it can be a software-only solution, or it may mean adding a hardware board to the computer. It makes little difference to the user."
Watson gives an example: "You can target American guests, for instance. If they are using calling cards to ring the USA, they are causing congestion on the hotel exchange and generating very little profit, even if there is a charge for the connection.
"But if you can tweak the cost of calls to the USA, making them, say, 75p a minute rather than AT&T's rate of 91p, you can advertise the fact that your calls are cheaper - and they don't have to key in all those digits. It could be a selling point with major accounts.
"You can also have limited special offers, such as cheaper calls at Thanksgiving. Hotels can use this as a means of attracting revenue. We estimate that offering calls to the USA at 75p per minute could let hoteliers move from making a profit per call of 19p to a profit per minute of 37p."
"It's a good example of call management as opposed to call logging," adds Peter Evetts, sales director of TMS. "Call managers can make sure calls are charged appropriately, such as when a guest uses directory enquiries. This "costs" five meter pulses, which could come to £1.25 when the hotel's mark-up is included. But call managers can tell that the call was to directory enquiries and charge a more acceptable amount.
"This is what call management is. It's more than call logging - it means management of the hotel's revenue, reducing costs and maximising returns."
Market costs
Luis Desouza, director of NFS Europe, which produces software for the hospitality industry, points out similarities between the UK and US markets. "The way the market is going, hotels select carriers which best suit the profile of the traffic.
Carriers are progressively reducing costs, especially compared with BT's standard rate - although very few customers are on that now, because BT is constantly introducing discount schemes. There is a high margin on telephone sales, and if you buy telephone time for less, your margins go up."
"We are moving from a hardware approach to a software approach," adds Adrian Powell, interface product manager of hospitality software provider Host UK. "Telecoms and computers are different industries that don't work well together, but are being forced to. Telephone companies are the ones having to move, but they are doing so very slowly.
"Heaps of services could be provided along telephone lines, such as the Internet, faxing, conference calls, shopping, cable television and video on demand," adds Powell.
"Even BT's new answering service could have been made available 10 years ago. The problem has been that legislators feel the telephone system is an area of national concern, and have made arbitrary rules. But, like the Internet, it can no longer be controlled."
Record extension making the call
Record number dialled
Record time and date call finished
Record duration of call
Record number of units used
Post call to guest's account or dump it to the allocated account if the guest has not checked in
Allow the hotel to set different mark-ups for different charge bands, and other rates such as minimum charges, one-off charges for calling cards and directory enquiries, and discounts for heavy usage
Allow each rate to be altered separately
Allow reporting and analysis of calls
Control conference room calls
Record administration extensions as well as guest extensions and charge each at the appropriate rate
Additional services offered by a call manager
Give greater control of calls made from each telephone
Record how long staff take to answer calls
Monitor lines to ensure they are working
Allow the room status to be changed via the switchboard
Allow lines to rooms to be turned on and off
Transfer data from front of house so that when a guest calls reception the member of staff can look up who is calling
Provide guests with various automatic services from the telephone keypad
Alert guests when a message is waiting
Sources: Innsite Hotel Services, Infodata, Welcome
